Previously a $15/month fee, Amazon Fresh has now been recast as a free benefit for the e-commerce giant’s Prime subscription members, meaning even more U.S. consumers now have access to one- and two-hour grocery delivery in more than 2,000 cities and towns.
“Grocery delivery is one of the fastest growing businesses at Amazon, and we think this will be one of the most-loved Prime benefits,” said Stephenie Landry, VP of Grocery Delivery at Amazon. “Given the rapid growth of grocery delivery we expect this will be a popular benefit.”
To be eligible, Prime members must request an invitation to shop at Amazon Fresh or Whole Foods, which Amazon purchased in 2017. This change is one of several recent tweaks to Amazon’s grocery strategy as the company continues expanding its grocery delivery and pickup services to new cities.
In last week’s Food On Demand, we brought you a report from MetLife predicting that U.S. online grocery sales could double by 2023. That figure would equal 7 percent of the total estimated grocery market four years from now.
A recent report from the grocery analysts at Brick Meets Click claims online sales now account for 6 percent of the U.S. grocery market, meaning there are some competing stats on the size and growth of the category. The report added that household penetration has risen more than five percentage points over the last year, now hitting 25 percent of all U.S. households.
“There’s still a fair amount of purchase trial—occurring as consumers search for acceptable online shopping alternatives,” said David Bishop, Partner at Brick Meets Click. “For example, we found that approximately one-third of the active households’ most recent online order was the first time they used the service.”
According to the analysis, online providers are improving the shopping experience as the likelihood of using a specific service again jumped from 69 percent in 2018 to 81 percent this year. Improving the ability to find the products that a customer wants to purchase is a key factor and the percentage of customers who found everything they wanted to buy rose to 90 percent in 2019, a twelve percentage point gain versus last year.